Lagarde calls for urgent action on banks F.T.

''European banks may need forced capital injections to stop the spread of the eurozone’s sovereign and financial crisis, Christine Lagarde has said, in one of the starkest warnings from a senior policymaker about the danger of a new global slowdown.

In a speech at the Federal Reserve’s annual gathering of central bankers in Jackson Hole on Saturday, the managing director of the International Monetary Fund said policymakers on both sides of the Atlantic must act now to deal with rising risks to the economic recovery..''

Ms Lagarde’s comments came as EFG Eurobank and Alpha Bank, Greece’s second- and third-largest banks, said they were close to announcing an all-share merger to be followed by a €500m capital injection.

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